Google announced on its blog that it was buying Motorola Mobile. The price will be somewhere in the range of $12.5 billion, a premium of 63% compared to the closing price of Motorola Mobile on Friday, reports Computerworld.
The purchase hurts Microsoft in many ways. First is that it ensures Motorola will continue to focus its smartphone and tablet efforts primarily --- or possibly solely --- on Android. As CEO Larry Page wrote on the Google blog announcing the purchase:
In 2008, Motorola bet big on Android as the sole operating system across all of its smartphone devices. It was a smart bet and we're thrilled at the success they've achieved so far. We believe that their mobile business is on an upward trajectory and poised for explosive growthRecently Motorola Mobility CEO Sanjay said that Motorola was open to manufacturing Windows Phone 7 devices, even though, as the Google blog notes, up until now it only manufactured Android smartphones.
Motorola's total commitment to Android in mobile devices is one of many reasons that there is a natural fit between our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers everywhere.
The chances of Motorola making Windows Phone 7 devices just plummeted, if not vanished. And even if Motorola ever did manufacture a Windows Phone 7 device, fearing an anti-trust look from the feds if it didn't, it wouldn't pour any significant resources into the device or marketing it.
Microsoft was looking to Motorola to help salvage Windows Phone 7, because the Nokia deal, by itself likely won't save Microsoft's struggling smartphone OS. Rumors had Microsoft looking to ink a Nokia-like deal with Motorola, or even buying the company.
Google, once again, beat Microsoft to the punch.
The purchase of Motorola may help Google's fight against Microsoft in one other way --- to fend off lawsuits Microsoft has launched to try and kill Android. As Page explained on the Google blog:
Our acquisition of Motorola will increase competition by strengthening Google's patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies.There's one more way in which the Google-Motorola deal will hurt Windows Phone 7 --- combining Motorola's expertise in hardware design and manufacturing with Google's software skills makes it more likely that Android smartphone will become become even more powerful and better designed than today. The phones and tablets will become that much more difficult to compete against.
Up until today, Microsoft was facing an extremely difficult task in trying to revive the fading Windows Phone 7. Today that task became much, much harder.